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Disney shares spike on profit beat, dividend hike

Friday, February 09, 2024

Today’s headlines

What’s happening: Shares of Walt Disney Company surged on Thursday, after the company released results for its fiscal first quarter.

What happened: The entertainment giant reported better-than-expected earnings for its latest quarter and announced a new partnership.

Disney also raised its cash dividend, while the company’s board approved a new share repurchase program.

How were the results: The company reported almost flat revenues for the period ended December 30.

  • Revenues came in at $23.5 billion, which missed the consensus estimates of $23.64 billion.
  • Adjusted earnings grew to $1.22 per share, beating Wall Street expectations of 99 cents per share.

Why it matters: Subscribers to the Disney+ streaming service eased to 149.6 million during the quarter, coming in below market estimates of 151.2 million. However, the overall losses in the company’s streaming businesses, including Hulu and ESPN+, narrowed to $216 million, from $1.05 billion in the year-ago quarter.

Walt Disney’s international parks delivered a strong performance last quarter, where profits surged over fourfold, and sales climbed 35% year-over-year. However, revenues from content sales and licensing contracted 38% year-over-year, while sales at the company’s domestic TV networks declined 14%.

The company plans to target $3 billion in share repurchases during fiscal 2024, while also raising the cash dividend to 45 cents per share.

Management guided to earnings of $4.60 per share for 2024, representing around 20% growth.

Disney, which added 111.3 million core Disney+ subscribers during the latest quarter, is looking to add between 5.5 million and 6 million subscribers in the current quarter.

Disney also announced a partnership with Epic Games and plans to invest $1.5 billion for an equity stake in the leading videogame company.

How shares responded: Walt Disney’s shares jumped 11.5% to close at $110.54 on Thursday, following the release of quarterly results. The stock has added around 23% over the past month.

What to watch: Investors will continue monitoring subscriber numbers for Disney+ as well as approvals for the company’s equity stake in Epic Games.

The markets today

The Canadian dollar will be in focus today ahead of the country’s jobs data

Context: The CAD/USD forex pair edged higher on Thursday amid a surge in crude oil prices.

Details: Investors monitored minutes from the Bank of Canada’s recent policy meeting and hawkish remarks from the central bank’s Governor Tiff Macklem.

The BoC has increased its key overnight rate 10 times in the last 17 months, to 5%, but has maintained rates at its last four meetings. Canada’s inflation eased to 3.4% in December, from a high of 8.1% in June 2022. Central bank policymakers are scheduled to announce their next policy decision in March.

Strength in prices of crude oil, one of Canada’s major exports, lent support to the loonie on Thursday. WTI crude oil prices jumped $2.36 to settle at $76.22 per barrel.

However, strength in the US dollar limited the overall gains for the CAD/USD forex pair. The US dollar index, which measures the greenback’s performance versus a basket of major peers, gained around 0.1% to 104.17 on Thursday.

The CAD/USD forex pair added around 0.03% to 1.3461 on Thursday. The S&P/TSX Composite Index fell 0.24% to close at 20,919.64.

What to watch: Investors await the release of jobs data from Canada today. Analysts expect the unemployment rate in Canada to increase to 5.9% in January, from 5.8% in December.

Employment in Canada, which rose by just 100 in December, is expected to increase by 15,000 in January. Average hourly earnings for permanent employees are expected to grow by 5.5% year-over-year in January, following a 5.7% rise in the previous month.

Other Markets: European indices closed mixed on Thursday, with the FTSE 100 and STOXX Europe 600 Index down by 0.44% and 0.07%, respectively, and the DAX 40 and CAC 40 up by 0.25% and 0.71%.

The news shaping the markets

Ukraine’s President Volodymyr Zelenskyy named Oleksandr Syrsky as the new head of the country’s armed forces, following the dismissal of General Valerii Zaluzhnyi. The news sent the safe-haven US dollar index slightly lower this morning.


Indonesia’s motorbike sales fell 3.7% year-over-year to 592,700 units in January. This contraction being significantly lower than the 11.6% decline a month ago lent support to the IDR/USD forex pair.


Brazil’s new vehicle sales declined by 34.9% to 162,000 units in January, following a 16.9% surge in December, which sent the BRL/USD pair lower in forex trading this morning.


The Bank of Mexico kept its record-high benchmark policy rate unchanged at 11.25% during its January meeting. This being in-line with expectations lent support to the MXN/USD forex pair.


US wholesale inventories grew by 0.4% in December, after falling 0.4% in November, which sent the Dow Jones index higher by around 50 points on Thursday.

What else to watch today

Germany’s consumer price index, Turkey’s industrial production, China’s current account, Italy’s industrial production, India’s value of loans, deposit growth and foreign exchange reserves, Mexico’s industrial production, US Baker Hughes crude oil rigs and Baker Hughes total rigs, Spain’s consumer confidence indicator, as well as Russia’s GDP rate.


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